Aileron Project EL 24287 Native Gap Annual report for period ending 11 February 2009

Abstract

EL 24287 was granted to Imperial Granite and Minerals Pty Ltd on 11th February 2005. Atom Energy Ltd purchased the property from Imperial Granite and Minerals in April 2007. A Farm-In and Joint Venture Agreement was agreed upon with NuPower on 1st November 2007 and was executed on 8th July 2008 to explore for energy minerals. NuPower was attracted to the Native Gap property by its strategic position amongst NuPower's own tenements of the Aileron Project. The Native Gap tenement is underlain by Division 1 and 2 basement rocks of the Aileron Province. Although the area has been poorly explored for gold and base metals it appears to have never been explored systematically for uranium. The area formed part of the NuPower regional airborne electromagnetic (AEM) surveys in 2007 and 2008 for palaeochannels as hosts for sandstone hosted uranium in Cainozoic sediments and the Geoscience Australia-NTGS Central Arunta Gravity Survey (CAGS) that provided valuable data for the interpretation of basement structures as controls for other styles of mineralisation including gold, rare earths, carbonatites and diamonds. The AEM survey over Native Gap consisted of 1800.8 line kilometers representing 17% of the total survey. It was flown at a nominal survey height of 120m on 1km spaced lines. The gravity survey consisted of 409 stations at 2km x 2km spacings. The survey of Native Gap located a shallow trough on the northern side of the Hann Range with palaeochannel outflows to the west and east, a thickening sequence of Cainozoic sediments on the margin of the Burt Basin in the western part of the license and two south flowing palaeochannels in the eastern part that merge with the northern margin of the Burt Basin. Two bore water samples from the northern and central parts contained high levels of U and F consistent with the waters being derived from shallow basement granites and gneisses of the Reynolds Range and the Sheppard's Bore gneiss respectively. They appear to be excellent source waters for the formation of secondary uranium in deeper parts of the Cainozoic sediments in the western and central parts of the license and scout rotary mud drilling is recommended in these areas. Waters from 3 other bores appear to downgrade the potential for secondary uranium in the Allungra Creek and easternmost palaeochannels. The use of biogeochemistry and in place of hydrogeochemistry as an exploration tool has been demonstrated but requires further validation by sampling of waters from scout drill holes and the surrounding vegetation in conjunction with the results of that drilling.